Apparel & Footwear

Christie Brinkley, Xcel Brands Ready to Launch Lifestyle and Apparel Brand Exclusively for HSN

Christie Brinkley and Xcel Brands Inc. have come together in a new venture for HSN. They have created a new lifestyle and apparel label called Twrhll (Towerhill) by Christie Brinkley that will be distributed exclusively on HSN, beginning in May. Brinkley, the 70-year-old supermodel, actress and entrepreneur, will serve as the public face and voice of the brand, including appearing on live broadcasts and streaming services for HSN. Twrhll encompasses knit dresses, woven tops, knit tops, denim, bottoms, hats, belts and a bag. Sizes range from XXS to 3X, and prices go from the $20s to $30s for belts and hats to $39 to $90 for apparel. The collection is inspired by Brinkley’s love of art, architecture, gardening and the sea, as well as her home in the Hamptons. Brinkley will make live appearances from the HSN studios in St. Petersburg, Fla., beginning May 30, where she’ll share with HSN customers her inspiration behind the line. In addition to Twrhll by Christie Brinkley and C. Wonder, Xcel Brands owns Halston, Judith Ripka and Logo by Lori Goldstein brands. It also has stakes in Isaac Mizrahi and Longaberger.

 

Messi Clothing Line Sold to Blackstone-Owned Centric Brands

Lionel Messi’s casual clothing brand is being taken over by Centric Brands, a clothing maker owned by private equity giant Blackstone that also licenses clothing and accessory brands including Nautica, Kate Spade and Izod. Centric is assuming the license from MGO Global, a publicly traded business co-founded by fashion veteran Ginny Hilfiger. MGO is selling the license to Centric for a $2 million cash payment; Centric will pay a €1.5 million ($1.6 million) royalty payment due to the soccer star, according to the term sheet of the transaction filed with the Securities & Exchange Commission Tuesday. The move culminates a disappointing run with the Messi license for MGO. MGO, which was founded in 2018, acquired the rights to create the Messi Brand of non-sports-related casual clothes, outwear and children’s accessories from the soccer star, and the business had designs to build off its rights to the Messi brand to create a series of athlete and celebrity fashion brands. For all its reported quarters, however, MGO has been unable to sell enough Messi merchandise to match what it has been paying Messi.

Canada Goose cuts corporate workforce by 17%, shakes up executive roles

Following “a comprehensive review” of its organizational structure, Canada Goose is cutting its corporate roles by 17%, the luxury outerwear brand said on Tuesday. That includes some shakeup among executives, including the March 19 departure of Chief Operating Officer John Moran, per a company press release. Beth Clymer, who is president of finance, strategy and administration, will add operations to her role. Carrie Baker, president of brand and commercial, will expand her responsibilities to also include design, working closely with CEO Dani Reiss. And Chief Transformation Officer Daniel Binder will now also oversee global stores in addition to responsibilities in sales planning and operations. This strategic review and realignment of resources comes as Canada Goose faces declines, particularly in North America, challenged comp sales and slowing sales in China, even in cold weather favorable to sales of its gear. The brand is realigning its teams to ensure its resources effectively fuel growth, Reiss said in a statement.

 

Designer Brands Posts Q4 Loss After ‘Difficult’ 2023, Shares Fall

Shares of Designer Brands Inc. (DBI) dropped more than 10 percent on Thursday morning in pre-market trading after the retailer reported a decline in comparable sales for the fourth quarter and year. Net sales for the DSW parent company decreased 0.8 percent to $754.3 million in the fourth quarter of 2023. Comparable sales also decreased by 7.3 percent in the period while adjusted net loss was $25.3 million, with loss per diluted share of 44 cents. The results beat analysts’ expectations that targeted a net loss of 47 cents and sales of $747.35 million. In a statement, DBI chief executive officer Doug Howe described 2023 as “a difficult year” due to a “softening footwear market, highly promotional retail environment, and the impact of unseasonably warm weather on our seasonal footwear business.” He added that DBI’s portfolio of owned brands, including Keds, Topo, and Le Tigre, helped guide the company’s Q4 performance. Net sales for the year were down 7.3 percent to $3.1 billion, in line with the company’s guidance issued in Q3. Adjusted net income was $43.2 million, with an adjusted diluted EPS of 68 cents. Diluted earnings per share was 46 cents, short of the anticipated range outlined by the company last quarter. Despite the challenges, Howe said the company plans to return to growth in 2024 during what he described as a “transition year.”

 

 

Athletic & Sporting Goods

Revelyst Announces Acquisition of PinSeeker, a Leading Skill-Based Golf Simulator Competition Platform

Revelyst, a collective of world-class brands that design and manufacture performance gear and precision technologies and a segment of Vista Outdoor Inc., announced it has acquired PinSeeker, a Wasserman portfolio company and the leading simulator off-course golf and connectivity app that hosts real-time, virtual, closest-to-the-pin tournaments.  The PinSeeker app enables golfers to compete in contests and challenges with their friends, families and fellow golfers, wherever they are located. The app hosts virtual tournaments, closest-to-the-pin challenges and other contests where participants can play for free or compete for real money, experiencing the thrill of competitive golf with anyone, anywhere.

Boardriders Laying Off Hundreds of Southern California Employees in Second Staff Reduction

The bad news just keeps coming at Boardriders, the Southern California conglomeration of surfwear brands acquired by Authentic Brands Group last year.  The company is continuing to reduce headcount and is negotiating cost-cutting contracts with its team of athlete ambassadors who front the various surf and skateboard brands. In documents filed with the California Employment Development Department in recent weeks, Boardriders outlined a Feb. 4 to April 26 layoff plan to dismiss at least 590 employees. Most of those – some 474 – are losing their jobs at the company’s big distribution center in Mira Loma, Calif., almost 50 miles east of Los Angeles. The rest of the lost jobs will be mostly at the surfwear conglomerate’s headquarters in the seaside city of Huntington Beach, Calif., popularly known as Surf City. The layoffs come after Boardriders eliminated 84 major staff positions in September, including many C-suite executives. The first layoffs occurred after Authentic acquired Boardriders Inc. in September for a reported $1.25 billion. The deal with Boardriders included the well-known California surf-oriented labels Quiksilver, Billabong, Roxy, RVCA, DC Shoes, Element, VonZipper, Honolua and Boardriders’ namesake brand.

L Catterton Makes Significant Investment in Off-Road, Off-Grid Vehicles

L Catterton, the consumer-focused investment firm, has significantly invested in Storyteller Overland, the manufacturer of off-road, off-grid vehicles headquartered in Birmingham, AL.  Storyteller Overland, founded in 2018, manufactures Class B RV and expedition vehicles. In addition to selling its vehicles at over 40 dealers in the U.S., it also offers adventure gear, accessories and technology for the outdoor lifestyle enthusiast.  With L Catterton’s investment, Storyteller Overland plans to accelerate product development, invest in manufacturing and enhance its dealer network. The financial backing will also enable the company to explore new opportunities to expand and innovate within the outdoor adventure market.  L Catterton has significant experience investing in outdoor brands. Current and past investments in the space include Pinarello, Getaway, Airxcel, Truck Hero, Heartland RV, and Leslie’s.

Cosmetics & Pharmacy

Ulta Announces Plans to Launch in Mexico Next Year

Ulta Beauty has announced plans to launch onto the Mexican market next year. The US beauty chain has entered into a Joint Venture with Axo in order to facilitate its international expansion. The move has been motivated by the success of Ulta’s border stores and, if it goes ahead, will be Ulta’s first international foray after it pulled out of a planned entry to Canada in 2020 citing pandemic closures as the reason. Ulta CEO, Dave Kimbell told Retail Dive, “The Mexican beauty market is sizeable, growing and has significant beauty opportunity. Our research suggests there us a healthy awareness of the Ulta Beauty brand with local beauty enthusiasts and we also see strong engagement in stores located in geographically adjacent markets.”

Allies of Skin Raises $20M From Meaningful Partners

Allies of Skin, the Singapore-based skin care brand, has raised $20 million from Meaningful Partners. The funds will be used to accelerate Allies of Skin’s U.S. push, online and offline, including more marketing, research and development, and team-building there. Nicolas Travis launched the science-led brand in 2016 with three products. The 1A All-Day Mask was the hero of the trio, which stemmed from Travis’ belief in double masking and combination treatments. The line has grown since and today includes a full skin care range, with formulas containing clinically proven actives – such as retinoids, vitamin C and antioxidants – in high concentrations and biocompatible formulas to repair, regenerate and train skin to perform at its best in minimum steps, according to Allies of Skin. The brand is now sold in 36 countries through 40 retailers, including Space NK, Mecca, Sephora, Dermstore and Cult Beauty. Altogether it is present in more than 800 doors. Allies of Skin is also sold online through allies.shop.

Personal Care Brand 900.care Fundraises 21M Euros for Its Refillable Products

Natural, refillable, by-subscription skin care and hygiene brand 900.care has raised 21 million euros. The funding round was led by Lombard Odier Investment Managers, alongside 900.care historic investors White Star Capital, Swen Blue Ocean and Founders Future. With the new funds the French brand’s founders Aymeric Grange and Thomas Arnaudo plan to step up 900.care’s internationalization in neighboring countries after successfully entering Belgium and Switzerland. The company has sales of 10 million euros a year and counts more than 235,000 active subscriptions and 25 employees in France. Thanks to the use of its products since launch, more than 4 million pieces of plastic waste have been avoided, 1.5 million tons of carbon dioxide were saved, and more than 500,000 liters of water did not need to be transported, according to the company.

Vitality Brands Announces Acquisition of Essano

Vitality Brands has announced that it is set to acquire Kiwi beauty brand, Essano. The deal is expected to close by the end of March with Pencarrow Private Equity surrendering its stake in the brand– financial terms were not disclosed. According to a report published by Inside Retail, Vitality Brands will build its own workforce in New Zealand, where Essano will continue to operate its manufacturing facility. Vitality Brands Co-founder and MD, Richard Meyrick, told Inside Retail, “The combination of Vitality Brands and Essano presents an exciting opportunity to further advance our international standing in the beauty sector. Essano has a strong presence and loyal customer following in the New Zealand market and the Essano brand will be an essential ingredient in our plans to expand the entire portfolio of brands across the globe as we leverage Essano’s innovation and R&D capabilities to benefit the wider Vitality Brands portfolio.”

 

Discounters & Department Stores

Macy’s closures a win for off price

Macy’s plans to shutter 150 underperforming stores in the next five years is set to be a boon to off-price retailers, according to research from Jeffries analysts and Earnest Analytics. Both firms see the retailers run by off-price conglomerate TJX, particularly its T.J. Maxx banner, as benefiting the most. Competitors as well as other Macy’s stores could grab billions in sales from the closures, according to Jeffries analysts led by Corey Tarlowe. “Given TJX’s significant customer and real estate overlap with Macy’s, we believe that, over the next 3 years, there will be a few billions of dollars of share gain opportunity,” Tarlowe said in a Wednesday client note.

Sephora deal ‘a real coup’ for Kohl’s, CEO says

Sephora’s performance at Kohl’s is helping the department store drive growth, CEO Tom Kingsbury said Tuesday.  At the same time, the retailer is pursuing a larger overall revamp of its shopping experience by broadening its offering with consistent newness, trendy merchandise and the addition of familiar big-name retail brands through store-in-store partnerships. “Kohl’s, candidly, was never really in the beauty business,” Kingsbury said during an on-stage interview at Shoptalk this week. But now, due to the beauty retailer’s presence at Kohl’s, Kingsbury said 40% of customers who shop Sephora at Kohl’s are new to the department store. Additionally, Sephora brings a younger, more diverse, trend-oriented customer to Kohl’s. And 40% of those customers who came for Sephora have additional items in their basket.

Vizio says Walmart to refile antitrust review application for merger

Walmart has notified two U.S. antitrust agencies it will withdraw and refile a certain review application for its planned acquisition of Vizio, to give the regulators more time to review the deal. Following informal discussions with the Federal Trade Commission and the Department of Justice, Walmart’s Hart-Scott-Rodino notification and report form was withdrawn effective as of March 27 and it expects to refile on March 29, Vizio said on Wednesday. The Hart-Scott-Rodino Antitrust Improvements Act of 1976 requires parties to report large transactions to both the agencies for antitrust review. The law sets a 30-day waiting period for parties to close transactions, giving the agency time to consider and block proposed mergers before they are consummated. The waiting period for Walmart-Vizio will expire on Friday unless extended by a request for additional information. Upon renewing the filing, the waiting period will expire on April 29.

 

 

Emerging Consumer Companies

Blueground defies proptech challenges, raises $45M, expands globally
Blueground, a furnished rental startup founded by Alex Chatzieleftheriou in 2013, has defied proptech challenges by generating $560 million in revenue and raising $45 million in a recent funding round. The company was created to address the lack of short-term furnished apartments in Europe, with Chatzieleftheriou’s personal experience driving the business idea. Blueground has expanded globally, managing 15,000 apartments in 32 markets across 17 countries. The company recently acquired Tabas in Brazil, Travelers Haven in the US, and Nestpick to enhance its offerings. Despite a downturn in demand for temporary housing due to employees returning to offices post-pandemic, Blueground’s growth and profitability have attracted investors. Sales increased by 70% in 2023, reaching $560 million, with a gross margin of approximately 35%. The new funding will support market expansion, technology investments, and potential future IPO plans.

 

Emma and Jens Grede invest in The Elder Statesman
Emma Grede and Jens Grede, the duo behind Skims, have invested in luxury knitwear brand The Elder Statesman. The brand was founded by Greg Chait in 2007 and is known for its high-quality cashmere pieces. The Grede’s investment is part of a $17 million funding round for The Elder Statesman, which will be used to expand the brand’s product offering and global presence. Emma Grede stated, “We are excited to be partnering with Greg and his team to help them realise their vision for the brand.” The Elder Statesman has gained a strong following among celebrities and fashion insiders for its unique designs and craftsmanship. This investment from the Gredes will help the brand continue to grow and solidify its position in the luxury knitwear market.

Chiyo offers postpartum nutrition support, holistic approach, $3 million funding
Chiyo, a food-as-medicine startup, raised $3 million to help postpartum moms with nutrition. The company offers meal delivery services, digital guides, and health coaching for women from fertility through postpartum. Co-founder Irene Liu was inspired by traditional Chinese medicine and a holistic approach to food. Chiyo has served 100,000 meals since launching in 2021, with revenue growing 300% in the last year. The company aims to expand its offerings to serve the full women’s health journey, including a menstrual cycle fertility program. The 40-day postpartum program starts at $69 per day. Chiyo’s goal is to get users off the program, with the average user staying for about four weeks. The company received a $3 million investment from Bread & Butter Ventures and plans to scale distribution through clinics and invest in food as medicine research. Liu hopes to prove the ROI on investing in nutrition for healthcare cost savings and collaborate with clinics and hospital systems for nutritional support.

 

 

Food & Beverage

SemCap invests $68 million in Aloha

Plant-based protein bar, protein beverages, and protein powder company Aloha is joining SemCap Food & Nutrition’s portfolio after SemCap invested $68 million to place a “significant minority stake” in the company. The investment of secondary capital also will buy out early angel investors, according to the company. With Aloha being an employee owned and operated company, employees and management will still be able to retain a significant stake in the company as well as maintain Aloha’s status as an independently operated entity. SemCap’s investment will help Aloha to focus on scaling acceleration of traditional retail channels and continuing enhancing its digital presence. Brad Charron, Aloha’s re-founder since late 2017, will continue his role as chairman and chief executive officer for Aloha.

Sazerac buys BuzzBallz

Buffalo Trace owner Sazerac has bolstered its ready-to-drink (RTD) portfolio with the acquisition of BuzzBallz. Founded by Merrilee Kick in 2009, as part of her master’s degree thesis project, BuzzBallz’s portfolio includes cocktails, chillers, biggies and mixed drinks. Presented in spherical shapes, the products are packaged in 100% recyclable materials. Sazerac said the deal is mutually beneficial and will boost its portfolio with a ‘fun, unique, pre-mixed RTD’ and further extend BuzzBallz’s customer base both domestically and internationally. The financials of the deal have not been disclosed and are subject to customary closing conditions, including receipt of regulatory approvals. Kick will stay on in her position as the company’s CEO. She said: “As a trailblazer in the RTD space, we have received many inquiries to acquire the company, however, Sazerac matched our innovative culture and spirit best.” Sazarac also owns Buffalo Trace Distillery in Kentucky, Fireball Cinnamon Whisky, White X Cognac, Eagle Rare and many more brands.

Trader Joe’s Opens ‘Pronto’ Small(er)-Format Convenience Store

Small-format grocer Trader Joe’s has opened Trader Joe’s Pronto, an even-smaller-format, convenience-like “grab-pay-and-go” concept store in Union Square in New York, in the space formerly occupied by the company’s wine store. A traditional Trader Joe’s store is approximately 15,000 square feet. Pronto is approximately 2,800 square feet in size. The name “Pronto” derives from Trader Joe’s founder Joe Coulombe’s original chain of convenience stores, called Pronto Markets, which opened in California in 1958. The first Trader Joe’s opened in 1967. Essen, Germany-based Aldi Nord, which also owns the Aldi small-format grocery chain, owns the Trader Joe’s chain, with more than 580 locations in the United States.

 

 

Grocery & Restaurants

One Group to acquire Benihana, RA Sushi parent in $365M deal

One Group Hospitality Inc., owner of the STK and Kona Grill concepts, will acquire Safflower Holdings Corp, the parent to the Benihana teppanyaki brand and RA Sushi, in a $365 million deal, the company said Tuesday. Denver-based One Group said the deal would be financed with $160 million in preferred equity and part of a new $390 million term loan and credit facility. The preferred equity will be primarily issued to Hill Path Capital, the company said. The deal is expected to close by the end of the second quarter, giving One Group a total of 168 full-service venues, the company said.

McDonald’s to sell Krispy Kreme donuts nationwide

McDonald’s Corp. and Krispy Kreme Inc. have agreed to sell donuts nationwide in the second half of this year, with nationwide availability expected by the end of 2026, the two companies announced Tuesday. Chicago-based McDonald’s had conducted a limited test of Charlotte, N.C.-based Krispy Kreme donut sales at nine locations in the Lexington, Ky., and Louisville, Ky., market last year, and the two companies announced in late February they would expand the partnership to 160 restaurants. Nationwide availability at participating restaurants is expected by the end of 2026, the companies said. Three of Krispy Kreme’s most popular donuts — original glazed, chocolate iced with sprinkles, and chocolate iced  — will be delivered to McDonald’s restaurants every day. They’ll be available individually, or in boxes of six, starting at breakfast and lasting throughout the day – while supplies last, the companies said.

Home & Road

Lidl to grow Garden Center concept to 76 stores

Discount grocery chain Lidl is expanding its outdoor Garden Center concept just in time for spring gardening season. The Garden Center concept was piloted in 2022 in Long Island, New York in partnership with Gabrielsen Farms, a local business who grows annuals, perennials, edible plants and shrubs. In 2023, the concept was expanded to more Lidl stores across the state, and this year, the Garden Center will be available in 76 stores across the Lidl US network. Lidl Garden Centers feature a variety of flowers, plants, soil, hanging baskets, planters and other gardening accessories. The garden centers will roll out in three phases in select stores. Germany-based Lidl operates more than 12,000 stores and is active in 32 countries, employing more than 360,000 employees globally. The grocer operates more than 170 states in the U.S. across nine East Coast states and Washington D.C.

Vietnam: The king of furniture for now, but will the reign last?

Vietnam’s shift over the past several years has run directly counter to China’s: Its rise has been meteoric. Vietnam was the top furniture exporter to the U.S. in 2023, according to Furniture Today research, exporting around $7.76 billion in furniture for the year, a 40% increase from the $5.5 billion seen in pre-pandemic 2019. Over the years of the pandemic, Vietnam was in close competition for that No. 1 spot with China, with each country trading narrow blows in 2020 and 2021. In 2022, however, Vietnam was $1 billion ahead. In 2023, it beat its rival by $1.8 billion. Vietnam’s strengths are plentiful. It avoids the steep 25% tariffs imposed on China during the Trump administration, in addition to being their main benefactor. Its workforce is skilled and wants to compete with China. The country’s industrialization has been swift, and its infrastructure is strong. Still, there is concern about Vietnam, mostly over its viability in the long term.

Jewelry & Luxury

Kendra Scott expands fine jewelry offering with lab grown diamond collection

Accessories retailer Kendra Scott is expanding its fine jewelry offering with the launch of its first stand-alone Lab Grown Diamond Collection. The collection offers customers luxe jewelry at lower price points, said its namesake founder. “We’re excited to introduce our Lab Grown Collection, a natural category addition as we continue to progress as a lifestyle brand and offer our customers another dynamic reason to shop with us,” founder and Chief Creative Officer Kendra Scott said in a press release formally announcing the launch. “We pride ourselves on putting the customer first and we heard over the years that our customers wanted to shop with us for fine jewelry because they loved the company, they loved that we give back, and they wanted their jewelry collections to grow alongside our product assortment.”

Record Sales at Brilliant Earth

Brilliant Earth, the US-based “ethical jeweler” reported record net sales, orders and gross margins for 2023. During the last quarter of the year it achieved its highest ever number of orders, up 18 per cent to 52,935, although the average value of each order was down 11.8 per cent to $2,349. “In 2023, we again reported record net sales, orders and gross margins and completed our fourth consecutive year with positive adjusted EBITDA,” said CEO Beth Gerstein in a statement. Net sales for Q4 2023 were $124.3m and for FY 2023 they were $446.4m. Gross profit for the three months ending 31 December was $73m, up 11.6 per cent on Q4 2022. “In 2024, we expect to continue making investments that will set the stage for long-term sustainable growth while also driving current and future share gains and profitability in the context of a still-normalizing industry,” said Jeff Kuo, Brilliant Earth’s chief financial officer. The San Francisco-based company launched in 2005 as a “digitally native, omnichannel fine jewelry company”.

Online Now Accounts for Nearly a Quarter of Signet’s Sales

E-commerce now accounts for 23% of Signet’s sales, nearly one quarter of its total, the company’s chief financial, strategy, and services officer Joan Hilson tells JCK. That’s particularly notable considering e-commerce represented just 5% of Signet’s sales in 2017, she says. Hilson says that while online growth has “leveled off a bit,” overall, “our online sales are strong,” she says. “We expect those sales to continue to grow and continue to increase penetration.” A back-end issue that popped up during the re-platforming of James Allen and Blue Nile hampered sales at those sites during the most recent quarter, she says, but online sales at its core banners, like Kay and Zales, remained strong. During its most recent earnings call, Signet said it will close up to 30 Ernest Jones stores in the United Kingdom, after selling 19 Ernest Jones locations to Watches of Switzerland in November.

 

Office & Leisure

GameStop cuts undisclosed number of jobs as Q4, full-year sales fall

GameStop said Tuesday in a regulatory filing that it recently eliminated an undisclosed number of jobs as a cost-saving measure. The move comes as the video game retailer reported double-digit net sales declines in the fourth quarter and for the full year ending Feb. 3. Fourth-quarter net sales fell more than 19% year over year to $1.79 billion from $2.23 billion last year. Net income for Q4 rose 31% to $63.1 million, up from $48.2 million, but gross profit fell 16% to $419.2 million, down from $499.8 million a year earlier, the company said. The company reported net sales for the full year fell 11% to $5.27 billion from $5.93 billion the prior year. It swung to a net income of $6.7 million from a net loss of $313 million in the year-ago period. A mix shift in software sales, fewer large game console releases, declining hardware sales and the growth of subscription services contributed to GameStop’s Q4 and full-year sales declines despite an extra week on the calendar, Wedbush analysts led by Michael Pachter said in a Wednesday note. As of February, GameStop said it had 4,169 stores — 2,915 were in the United States. The rest are in Canada, Europe and Australia. GameStop in its Securities filing yesterday echoed the concerns of many retailers, saying consumer reticence on discretionary spending is affecting the bottom line.

Report: Netflix to debut retail/entertainment concept at King of Prussia mall

Netflix is inching closer to making its brick-and-mortar debut. The streaming giant is looking to open its first physical retail and entertainment destination — dubbed Netflix House — at Simon’s King of Prussia mall in King of Prussia, Pa., in a vacant two-story space that was formerly home to Lord & Taylor, reported Globe Street.  The renovated 120,000-sq.-ft. space will offer customers an immersive experience of their favorite Netflix shows with related merchandise, food and themed live events. It is expected to be completed in time for a late 2025 opening, according to the report. In fall 2023, Bloomberg broke the news about Netflix’s planned entry into brick-and-mortar, noting that the locations would be where fans could “play, shop and eat.” In preliminary plans, the King of Prussia location will reportedly feature a first floor of two large experience rooms and a 250-seat theatre. The second floor will include two smaller experience rooms and a marketplace for food and drinks.

Private equity firms make multimillion-pound swoop for pet food business

Private equity firms Advent International and CVC Capital have reportedly joined forces to make a bid for Partner in Pet Food (PPF), an animal food brand owned by Cinven.  Cinven is seeking around €2bn for the business, the Financial Times reported, which said the talks were ongoing. The business, which owns brands such as Prevital and Reno, was formed out of a series of acquisitions between 2000 and 2006.  Private equity firm Cinven bought PPF in 2018. Advent previously acquired the business in 2011 before selling it to investment management group Pamplona Capital Management in 2015 for €315m. Buyout investors have been keen to inject funds into the pet sector in recent years as the sector has boomed due to people buying pets during the Covid-19 pandemic.  Veterinary clinics have been a focus, with private capital groups EQT and KKR making investments in that sector.

Technology & Internet

Amazon spends $2.75B on Anthropic in largest venture investment yet

Amazon is making its largest outside investment in its three-decade history as it looks to gain an edge in the artificial intelligence race. The tech giant said it will spend another $2.75 billion backing Anthropic, a San Francisco-based startup that’s widely viewed as a front-runner in generative artificial intelligence. Its foundation model and chatbot Claude competes with OpenAI and ChatGPT. The companies announced an initial $1.25 billion investment in September, and said at the time that Amazon would invest up to $4 billion. Wednesday’s news marks Amazon’s second tranche of that funding. Amazon will maintain a minority stake in the company and won’t have an Anthropic board seat, the company said. The deal was struck at the AI startup’s last valuation, which was $18.4 billion, according to a source.

 

FTX founder Sam Bankman-Fried sentenced to 25 years for crypto fraud

FTX founder Sam Bankman-Fried was sentenced to 25 years in prison on Thursday for the massive fraud and conspiracy that doomed his cryptocurrency exchange and a related hedge fund, Alameda Research. The sentence in Manhattan federal court was significantly less than the 40 to 50 years in prison that federal prosecutors wanted for Bankman-Fried, but it was much more than the five to six-and-a-half years suggested by his attorneys. “There is a risk that this man will be in position to do something very bad in the future,” Judge Lewis Kaplan said before sentencing the 32-year-old and ordering him to pay $11 billion in forfeiture to the U.S. government. “And it’s not a trivial risk at all,” Kaplan added. Kaplan noted he has never heard “a word of remorse for the commission of terrible crimes” from Bankman-Fried.

 

Finance & Economy

Key Fed inflation gauge rose 2.8% annually in February, as expected

Inflation rose in line with expectations in February, likely keeping the Federal Reserve on hold before it can start considering interest rate cuts, according to a measure the central bank considers its most important barometer.  The personal consumption expenditures price index excluding food and energy increased 2.8% on a 12-month basis and was up 0.3% from a month ago, the Commerce Department reported. Both numbers matched the Dow Jones estimates.  Including volatile food and energy costs, the headline PCE reading showed a 0.3% increase for the month and 2.5% at the 12-month rate, compared to estimates for 0.4% and 2.5%.

Revised Q4 GDP Data Hints at Disposable Income Pressures

Three months ago feels like a long time.  But the latest — and revised — data on gross domestic product released by the Bureau of Economic Analysis details the fourth quarter and gives some hints as to what may come in the months ahead.  The headline numbers show that real GDP was 3.4% higher in the fourth quarter, an upward revision of 0.2% from the earlier estimate for the period. The new revision still notches a marked slowdown from the 4.9% growth rate that had been seen in the third quarter.  The bureau said in its release that the upward revision was tied to increases in consumer spending and private investment, as supplemental materials revealed that real final sales in the quarter were 3.3% higher, up 0.4% from the earlier estimates. The price index was 1.9% higher, unchanged from earlier data, and the personal consumption expenditures (PCE) price index was also unchanged, with 1.8% growth.